World Oil Demand Growth Unchanged in June; EIA Cuts Forecast


· WTI crude oil price rose by 2.6% to USD94.54 per barrel

· World oil demand growth remains almost unchanged at 0.80mnbpd in 2013

· EIA cuts growth forecast for world oil demand in 2013

· Non-OPEC supply is projected at 0.98mnbpd in 2013

WTI stays above USD90 per barrel amid positive signs from the U.S.

WTI crude oil price rose by 2.6% during the review period (11 June-11 May 2013) to USD94.54 per barrel, spurred on by better-than-expected economic data in the United States that raised the prospect of stronger demand in the world’s top oil consumer. The recovery in the U.S. housing and labor markets has been positive. The United States added 175,000 jobs in May after climbing 149,000 in April. In addition, U.S. consumer sentiment rebounded in early May to the highest level in nearly six years as Americans felt better about their financial and economic prospects, particularly among upper-income households.

Economic development in the Euro-zone is mixed, Japan has improved

The industrial production in the Euro-zone improved in March by 1.0%, while the latest data of PMI for the manufacturing sector indicated a rise in the index to 48.3, although it is still points to a contraction as it remains below 50 level. Despite these positive factors, the Euro-zone economy contracted for the sixth straight quarter as it shrank by 0.20%. Meanwhile, the unemployment rate for April rose to 12.2% from 12.1% in March. However, the Japanese economy has improved as its GDP grew faster-than-expected by 0.9% in the first quarter driven by private consumption, where exports and industrial production have increased significantly.

World oil demand growth remains almost unchanged at 0.80mnbpd in 2013

OPEC held its forecast for growth in world oil demand unchanged at 0.80mnbpd to average 88.6mnbpd in 2013, and predicted demand will grow more quickly in the rest of the year as it expected global economy to recover. OPEC forecasts world oil demand would expand by 0.9mnbpd in the second half, up from 0.7mnbpd in the first six months of 2013. Meanwhile, OPEC supply rose by 0.1mnbpd to 30.57mnbpd, broadly in line with the average demand for OPEC’s crude in the second half of 30.47mnbpd.

Saudi crude oil production rose to 9.37mnbpd in May 2013

OPEC production ex-Iraq rebounded in April to 27.45mnbpd, an increase of around 0.13mnbpd. Meanwhile, crude oil production including Iraq rose by 0.11mnbpd to 30.57mnbpd, led by Saudi, Angola and UAE. The rise in Saudi Arabia has been driven by an increase oil demand by 5.1%YoY for the first four months of 2013 on the back of healthy economic activities, while additional crude would be required to cover the increase in air conditioning usage. On the other hand, Iraq production fell slightly in May due to slowdown in Kirkuk oil shipments after repeated attacks and maintenance operations in the south.


Please enter your comment!
Please enter your name here